Can James Finkelstein and Lachlan Murdoch Save Nielsen's Trade Titles?

Pluribus Capital Management Close to Deal for Billboard, Hollywood Reporter, Adweek Group

NEW YORK (AdAge.com) -- The Nielsen Company's beleaguered trade-publishing unit, including Billboard, The Hollywood Reporter and Adweek, is on the block again. Can a private-equity group including the publisher of The Hill newspaper and News Corp. scion Lachlan Murdoch save it?

Lachlan Murdoch Credit: AP
The titles have long been an awkward fit at Nielsen, whose core business is media measurement and market data, but now they have a serious suitor in James Finkelstein, CEO of News Communications, which publishes The Hill and Who's Who. Nielsen is said to want $70 million for all its titles, but an investment banker who has looked at the deal said that's high given the pace of revenue declines at the unit.

Mr. Finkelstein and his consortium want to operate the big brands -- Billboard, The Hollywood Reporter, AdWeek, MediaWeek and Editor & Publisher -- and sell off smaller titles such as Hospitality Design. "These businesses have not been well-managed; no one at Nielsen has lived or died by their success," another exec close to the deal said. "If there's a deal, it's soon."

Revenue at the unit, including the publications, websites and trade shows, was down nearly 30% to $82 million in the third quarter of 2009 from a year ago, but it still turned in $14 million in operating income because costs were slashed 35% due to headcount reductions and the sale of its Brazilian expo business.

The proposed deal, first reported by Sharon Waxman at The Wrap, includes all international ventures related to the 28 titles, as well as events under the trades' brands. It does not include conferences unrelated to the titles, which Nielsen will keep. A Nielsen spokesman declined to comment on the sale.

In addition to The Hill and Who's Who directories, Mr. Finkelstein, who controls News Communications along with his father Jerry Finkelstein, has owned and sold a series of business trades and local papers over the years. Mr. Finkelstein sold National Law Publishing Company to Wasserstein Perella in the late '90s, and then a group of community papers including Our Town, West Side Spirit, Chelsea Clinton News and the West Sider in 2001 and the Queens Tribune in 2002. The company sold a group of Hampton's papers and websites in 2007, netting a reported $20 million.

He also has a track record of looking at properties to buy and then walking. The New York Post named him as a potential suitor for New York Magazine, which was bought by Bruce Wasserstein in 2003. Mr. Finkelstein flirted for nearly a year starting in 2008 with Patrick Phillips, proprietor of media news aggregator IWantMedia, only to walk away when the Nielsen titles came back on the block.

His company has 92 employees and $12.1 million in revenue, according to Bnet. Mr. Finkelstein did not return several calls for comment.

The entity bidding for Nielsen's titles is a private-equity group, Pluribus Capital Management, which includes Mr. Finkelsein, former Wired publisher Matthew Doull (also on News Communication's board) and former Hearst International publisher George Green. Mr. Murdoch, who quit News Corp. in 2005 and runs his own private-investment group Illyria, is an investor in the proposed deal.

The sale is being managed by former Nielsen Business Media president-CEO John Wickersham, now at merchant bank Quayle Munro.

The collection of trade titles -- like many print publications -- has suffered during the downturn and struggled to adapt their models to the web. Adweek, Mediaweek, Brandweek and The Hollywood Reporter share substantial editorial content, and are looking for ways to maintain subscription revenue from print while distributing free content on the web.

One bright spot: while Billboard's trade business has stagnated, it has focused on its own consumer music site, Billboard.com and licensing business, which are growth drivers for the brand.

Competing titles at Reed Business, including Broadcasting & Cable and MultiChannel News, are also on the block in a sale handled by Jordan Edmiston Group.